Today many more people, government bodies, and entities are filing for bankruptcy due to the large debt it has and cannot repay. San Bernardino, a city located in California, filed for bankruptcy and one of its former financial advisers said that the city might have been forced to file for bankruptcy due to the misuse of the cityâ€™s funds. Misusing a cityâ€™s funds is a crime and is punishable with jail time or prison time. Â So far no one has been charged with misusing the cityâ€™s funds and currently there is no pending investigation, as reported by Thompson Reuters News & Insight in a June 5, 2013 article.
â€œCalpers, the giant state pension fund and the cityâ€™s biggest creditor, filed a pre-hearing document signaling that it was losing patience with the cityâ€™s pleas of poverty.â€ Moreover, Calpers is not only the stateâ€™s giant pension fund, it is â€œthe largest U.S. public pension system with assets of 256 billion.â€ Â San Bernardino stopped making pension payments to Calpers last year but it said that it will commence these payments soon. Calpers claims that the city owes about thirteen million dollars in payments. Also, before the bankruptcy claim was file the city did not try to work out some kind of settlement with its lenders or creditors and Calpers allege that so far the city has not notified its creditors how it intends to handle its creditors.
The city argues that it should be safeguarded due to the filing of the bankruptcy claim, whereas Calpers argue that the city should not because the city has not acted in bad faith. Â There is a court date scheduled for the upcoming week and the court is the one who will determine whether the city is entitled to any type of bankruptcy safeguard or not.
Also, when a bankruptcy claim is filed the person, government body, or entity can hire a financial adviser or consultant to advise the debtor and to take care of the bankruptcy process. This was done by the city of San Bernardino. San Bernardino is not the only city in California that has filed for bankruptcy as Stockton has done so too and the court found that Stockton was entitled to bankruptcy protection.
If you are in need of legal representation for a personal bankruptcy, then contact the law office of Jayson Lutzky, P.C. Mr. Lutzky has 30 years of legal experience representing satisfied clients. He offers free in office consultations. Call 718-329-9500 to set up a consultation. Visit us on the Web at www.MyNewYorkCityLawyer.com.